New Workflow feature: Your customers will probably be more excited than you are…

In my experience, Marketing folk tend to be less process oriented than other people in the enterprise, and when one talks to them about business workflow you can see their eyes glazing over. One gets the feeling that they would rather be watching a presentation on Paint Drying.

But if you subtly rebrand workflow as “Feedback Management” and explain that it helps to keep promises to customers” the excitement visibly level rises. In simple terms, that’s workflow in CustomerGauge. It stops you forgetting that Client X wanted his missing part sent that you promised. By the way, if you do forget this, you’ll definitely turn he/she into a detractor.

Workflow in CustomerGauge

If you are a regular reader, you will not be surprised to learn that CustomerGauge has a built in workflow Feedback Management system (another clue is in our tagline: Measure, Understand, Respond). It works like this: The customer (or internal user) can trigger a workflow item – a message is sent to the relevant department saying an issue with Client X is OPEN and the item is put in a queue; they then follow it up and mark it CLOSED; the loop is closed by a report showing the age of any OPEN items in a queue. That way any customer issue (complaint or praise) can be put to bed.

CustomerGauge has a template for a basic workflow “out of the box” which can be implemented rapidly (our design principle was “Just Add Water”, or in this case “Just Add Customer Service Agents”). More extensive workflows can be built including a final loop with the customer asking “Did we fix your problem?” and so on.

See a 2-minute presentation here (click for full size).



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You may not find it workflow exciting, but your customers will. Often, all they ask for is that you keep your promises. Remember, the reason that most customers defect is Indifference to Complaint.

Historical Note:

Actually the whole simple workflow thing came about because of a visionary Vice President I worked for at Sony in 2004. Until I met him, I worked under the Marketing Manager Customer Survey Standard Operating Procedure which is largely Ignoring Customer Feedback from Surveys or At Least Waiting Until Enough Time Has Gone By That It Can Be Safely Ignored It. I’m sure all marketing people know what I mean – yes, you! With your results from the 2007 survey locked in your desk with no responses – I’m talking to you!

But VP Gildas P insisted to me that we follow up all 250 customer feedback items we had just gathered within a week! An impossible task – I told him. However, it wasn’t. Of course it was possible (with some effort – we did it using Excel and scraps of paper). And it changed the way I thought about feedback. Dealing with the Voice of the Customer plus Net Promoter was the way forward. So that’s why CustomerGauge has this stuff built in – because if you ask the Customer for feedback, and the take the time to give it to you, we think you should be polite enough to deal with it and make sure you acknowledge it! Did I tell you about our built-in email engine as well? Ah well, maybe another time…

New Google-like Search in CustomerGauge

According to Norse legend, the god Odin went to great lengths to acquire wisdom, sometimes enduring pain and self sacrifice. To learn how to cast powerful magic from ancient runes, he hanged himself upside down from the tree Yggdrasil at the end of the world for nine nights.Well, who’s got that much time these days to get the answers from a simple question? To save you the troubles of Odin (a man so dedicated to learning wisdom he even gave up an eye for a drink from the well of knowledge), we bring the ability to make a Google-type search for customer feedback (or other order information) in CustomerGauge.

Now you can do a free-text search of the messages that CustomerGauge is collecting from your customers. For example: Which customers used the word “excellent” when referring to service? Or who said that delivery was “disgusting” in conjunction with Product A, but nor Product B.

In addition, you can instantly search through any of the fields captured in CustomerGauge: Order number, Customer Number, email, name, dates, product information etc. Like Google, you can use Boolean search terms: “+excellent -not”. We have optimised it, so it’s super speedy, even through 100,000 records.

We’ve used many ecommerce products, and think that this is better and faster than regular systems for searching through customer information. It’s part of our tool set to help you manage your customer feedback better.

Like to try it? We prefilled a search for you here.

We think Odin would have liked the idea, but would have likely rejected it as “too girly”.

Right Said Fred: Net Promoter Conference London (part 3 of 3)

They saved the best to last. Final item on Agenda at the London Net Promoter event was Fred Reichheld, author of “The Ultimate Question” and inventor of the Net Promoter Score.Fred is a magnetic speaker, and while I mused on how lucky SatMetrix and Bain are to have a person like this working with them, I found myself wondering why the PR bunnies there had not got him speaking TV or being interviewed by national press. I don’t believe the message is too specialised. We are all customers – we should all have companies working hard to win our business.

He first outlined how he had been pilloried in the press for Net Promoter. “Just one question? Too Simple!” screamed old fashioned measurement companies and “Dangerous for business!” Like Fred I firmly believe in the power of the short survey. Apart from anything else, it respects the customers time.

Another firm tenet of Net Promoter is the Open Source concept. Anyone can measure. It’s transparent and companies can benchmark each other. Again, rival companies hate that, as they can’t use proprietary, black box measurements.

He spoke eloquently about how the “Golden Rule” was a turning point for him. The more he looked, he found that companies who “Do The Right Thing: Treat customers how you would like to be treated” made Good Profits. Key examples: eBay, Enterprise Rental Cars. He quoted CEO Taylor from Enterprise: “The Only way to grow a business is to get customers to come back for more, and tell their friends”. Simple, eh?

Anything less than a 10 is a “fail”

Fred next surprised me by saying that Net Promoters strata of Detractors, Passives and Promoters were a good place to start, but that in reality, any customer who does not give you a “10″ when asked “Would you recommend…”, he would class as a failure. You did not really enthuse them. So shoot for 10s.

The key measurements of loyalty are

• Repurchase ratio
• Customers returning and buying additional lines
• Referrals: Who came by referral? Who Referred?
• How many constructive feedback comments come in?

The Gorilla vs. Big Dog

The lessons from Enterprise and others are that a revolutionary approach to metrics is needed. In the photo above you can dimly make out the slide Fred showed.

On the left: The gorilla of Profit. We have 300 years of measuring and understand profit – judging companies on performance – but often that metric works against customer loyalty. Hardly surprising when you learn that loyalty metrics are not robust.

On the right: his puppy dog representing today’s measurement of loyalty and satisfaction. No one takes them seriously. Too many metrics, not consistent, not reported at board level or Wall Street.

Solution: Companies that take this seriously turn loyalty metrics into something that is robust. They turn the metrics into a “Big Dog” (metrics with teeth) to compete with profit metrics! (Of course then the slide animated to show a big fierce dog. Great metaphor!)

Key elements to Big Dog metrics:

• 2 question survey with 95% response.
• Reduce detractors – make call backs
• Grow promoters – make rankings by branch, segment
• Make a Leadership Priority.

NPS should be as important as profits. Example of a turnaround was brokerage Schwab, who took NPS from -35 in 2004 to 23 in 2007. NPS was the first thing managers looked at every day.

Middle Managers are the Villains

Fred next discussed some examples of bad profits – actions that customers mad. Examples: Hotel phone bills higher than room fees, Opaque bank charges, charges for overdrafts,Cellular: best price for new customers (rewards DISloyalty), rental car petrol fees 3x retail etc.

Not only do customers hate these but front line workers dislike them, and so do CEOs. So who dreams these up? Middle managers who have to make profits.

Solving this he drew up a segmentation graph with NPS on bottom axis, and profitability on side axis. (Guess what – it’s the Magic Grid we have in CustomerGauge!)

NPS requirements

Fred said he thought many companies are playing at NPS. He listed the key tests that a company needs to pass if he were to mark them as NPS-aware.

1. Categorisation: Marking all customers as detractors, passive or promoter
2. A process in place to reduce number of detractors
3. Process to grow PROFITABLE prompters
4. Leadership priority

Just measure. The “Why?” is usually obvious.

The next frontier is Employee NPS. He outlined how Bain had taken seven years to get NPS into employee metrics. Now managers are bonused on it. The survey: “Is this the place you’d want a friend to work? Is your supervisor the sort of person you would recommend someone to work for? ”

So it takes a while for Big Dog (loyalty) metrics to compete with Gorilla (profit) metrics.

Saving Customers, Saving Lives.

He signed off a very interesting talk with a book recommendation: “Better” by Atul Gawande, a medical author who wrote of how another simple 0 – 10 metric had changed the world: The Apgar score to assess baby health. In 1950 1 in 30 newborns died in the US. In 2005 a mere 1 in 500 died. The score was deceptively simple. Yet it triggered and prioritised hundreds of life saving innovations.

I’m sure that while NPS might not save lives, it will really save a few customers, and who knows, maybe some companies as well…

Creating Customer Cults: Net Promoter Conference Day 2 (part 2 of 3)

Day2 Net Promoter Conference

eBay

Day Two of the Net Promoter London conference kicked off with Kip Knight of Ebay.

Factfans: 1.3 million people make all or part of their living from eBay. So listening to this community is pretty important for them – in fact eBay consider this community their strategic differentiator.

Their simple feedback mechanism has to date yielded more than 4bn results. And anaylsys of this has yielded some Net Promoter Economics – a key driver for eBay Management. They know that Promoters are 7.1x more likely to buy than detractors.

A few points I took away: They have a “Red Alert” program if something goes radically wrong based on NPS. Each week, the managers have a Monday morning ritual reading the previous week’s verbatim comments. Twice a month the “coded” verbatims are distributed to the right people.

SatMetrix

Laura Brooks VP Research and Consulting – SatMetrix: Laura’s content-rich presentation spoke about how loyalty is driven by trust – not simply products or services. Becoming a trusted partner means more to customers than product quality or operational excellence.

Laura also defined “Networked Promoters” (sounded very much like the mavens in one of my favourite books “The Tipping Point”). These are your consumers who are superfans, but who are also connected to many others (via Blogs, forums etc). As I was listening I was thinking of Delia, Nigella, Oprah…

The meat of her talk: findings from the PC industry (PC hardware makers) which has an average NPS of 27%. Apple is incredibly at 78% (80% promoters, 2% detractors).

I’m not showing the Referral Economic workings here (it’s in her white paper) but it shows how much a promoter is worth to the business.

Example:

• Average sales price: $1615
• Average sale price to Promoter: $1818. Extra value added by recommendation:  $816. Total: $2634.
  
• Average sale price to detractor: $1457. Value destroyed by  detractor: $1352. Net value: $105.

Moral: Create promoters. Detractors really produce bad profits!

Rules of thumb: Promoters refer up to 4 people on average. Top of the range (Apple) promoters refer at rates 1.7x higher than average! Learnings: Create passion around the brand, spend less on acquisition.

She wrapped up by urging solus Employee Net Promoter Surveys. Don’t mix with traditional 70 question HR-esque attitude surveys.

AON

Peter Harmer, AON CEO: Peter’s talk spoke about how AON sells a very conservative product (insurance) but had successfully implemented NPS to help them focus and improve sales.

First lesson was how NPS was different by customer value band. The lowest segment (almost SME companies) had lowest NPS. Turned out they just wanted simple transaction interactions and the account teams were largely ignoring them. So they switched these accounts into a more appropriate group within company.

AON also segmented customers on basis of job title: More senior execs in their customers seemed less happy than the risk adjustors or Admin folks.

Another telling graph was NPS by salesteam. The jolly Geordies from the North Eastern office were getting much higher scores than the sulk southerners. Best practice training followed swiftly…

Their textbook approach also analysed drivers to improve NPS, and plotted on axes of importance and performance, helping identifying the quadrant of what to improve. It helped AON take a defensive stance on some accounts and reduced the attrition rate by saving several accounts.

SIMPLE

Crispin Manners from Kaizo spoke about the UK cosmetic company Simple and how they had activated promoters.

This was one of the most impressive presentations for me – it was less about a text book approach to top-down and bottom-up improving actions, but more a real action plan rooted in limited resources but a lot of creative energy.

First the facts. 18 months ago Simple is a £60m company, #3 in market but with a loyal base of fans. 80% of their customers bought just one product. The brand was built on customer recommendation. But they found that customers who arrived through recommendation were most likely to become promoters (63% NPS).

They created a VIP panel of consumers via a web community (SimplyCity – see what they did there?) with benefits of trials, VIP voting, “first looks” and inside scoops.

Soon they found that just generalized beauty content was not valued. What this community wanted was more and more info about the brand. They wanted a clear personal relationship. In addition, financial rewards were not needed (discounts, exclusive products). The intimacy of feeling that they were being taken seriously by the brand was enough. The deal was with customers: “If you are an advisor, you should answer a few questions each month – about 3 minutes.”

Crispin reminded us about the “Hawthorne Effect”. When you ask advice, people become more positive. (See my article Checkups make you feel better…)

Some examples and numbers:

• The VIP community is now 6000 strong.
• Find people that love your brand AND the sector
• One item the community helped with was choosing “face of Simple” and chose favourite packaging.
• Product launch case study: Simple Derma was test marketed on the VIP community.
• Identified many new uses and marketing messages
• Got 530 customer reviews (many used in PR, marketing)
• 60% recommended – 35000 samples generated 30,000 product requests
• Result was a launch that exceeded expectations.
• Simple now #2 in market with 45% NPS (sector average around 20%), growth outperform by 2.5x
• And trials (cross – product usage) have now increased.

Crispin finished with a slightly off-topic but fascinating insight into cults, which succeed by

1. Giving people a sense of purpose
2. “Love-Bond” people. Thank and reward them
3. Make things simple (black and white).

Not explicitly linking with the Simple case, but you could see where he was going…

Travel Counsellers

Sales director of Travel Counsellors, Malcolm Hingley.

His presentation was on how their travel company could grow by focusing on excellence in customer service. Seems that they have found a magic formula: Their 900 franchised agents now turnover £255m. NPS was 82% in an independent survey (LastMinute was a paltry 3%).

Some amazing results. On their own NPS survey, half the agents scored 100% NPS, giving a group total of 94%.

Some practical tips:

• Engineer opportunities to keep in touch with end consumer
• Engage customers with thank you cards (nice anecdote about how one agent delivers tickets on horse back)
• A customer rating of 9 or 10 gets a personalized “Thank You”
• Future: They are instigating referral tracking “How did you hear about us”.
• Future: Customer feedback too on hotels, services etc will be integrated.

Final tip he gave from a Harvard survey (sadly I could not catch the detail): If you give good service, 5% will refer you. If you give good service, and ask nicely to recommend, then 50% will refer you.

"Zippin' up my Boots, Going Back to My Roots": Net Promoter Conference London: Notes Part 1

Notes from Net Promoter Conference, London -30 Apr – 1 May

“The only function of economic forecasting is to make astrology look respectable…” Richard Owen, CEO SatMetrix CEO opened the London Net Promoter Conference with a quote from J K Galbraith, making a rather sombre start to the event. His theme: how companies cope with a recession (sub text: they should rightly spend more on customer focus).

Particularly relevant to current downturn in financial markets was insight into how credit companies had artificially inflated Net Promoter Scores (NPS) by “buying” a high initial satisfaction from customers by offering tempting low start deals (i.e. mortgages). Customer dissatisfaction comes later when having to pay steep bills. Conclusion: Short term offers don’t work. Finance companies that don’t offer massive incentives to entice a mass of low quality customers are more likely to survive.

Next point was about what actions companies take in a recession (you see, all quite dour – at times he made Gordon Brown seem cheerful). Trick is to act like a small company. Instead of cutting costs, you focus on customer. Plenty of supporting stories here – and he took three examples: Dell, Starbucks and Charles Schwab who all have had tough times recently, and all three got their original founder back to make a turnaround. Apple also springs to mind. This is a case of “Going Back To Our Roots” and getting in the early entrepreneurial spirit.

Last point: Small focus groups are like customer Zoos. Now we have the technology to address all our customers, why not see the real thing, and go on safari?

ORANGE

Dominique Soudais from Orange, gave a passionate description of the road to NPS that his company (former France Telecom) had been on. Top points:

• NPS used as a lever for organizational change.
• NPS is a common currency in their company – like the Euro – all understand it. Previously they had 23 different measures of customer satisfaction across the organization
• Lots of NPS ambassadors across companies
• Many customer callbacks to understand detractors, but also help convert to promoters/
• Pushed up NPS 6 points in 8 months, target this year is 10 points.
• “Puts customer in the room” at exec meetings
• They have correlated NPS to customer churn rates

Also a good story about using “pavement NPS survey” on the Champs-Élysées stationing surveyors outside flagship store: They got NPS of 60 when it was deployed. Store people were aware, were sensitive to customer comments, and “raised their game”. Store Manager said he wants surveys every day, as it makes sales go up!

LEGO

Conny Kalcher from Lego spoke about using user communities.

Fact fans: There are 52 Lego bricks for every man, woman and child in the world, plus Lego is the largest tyre manufacturer in world*.

Story here is less about NPS, more about how listening to community of customers can change the way a company thinks and grows. She picked out how one customer storey, a Mr Richard James, who was a Lego fan and bought 1000′s of pounds of Lego each year, but was miffed when Lego did not care why he cancelled an order. The customer escalated it, and it became a turning point in their company to start to listen to customers (and also to heavily segment them).

They now have formalized their customer experience loop. For Lego, Voice of the Customer is something they take very seriously, and take steps to generate as much as possible through own online communities of fans. Nice metric: Which product box generates most calls?

Conny has a good handle on the economics of this: Each passive converted to a promoter generates 43€ sales. Each detractor converted to a passive generates €27. And promoters are worth €70 more in average sales than a detractor.

The community generated half a million visitors to Lego events in 2007. Conny outlined some of the benefits, but also difficulties they have working with them.

Sadly, the conference organisers had not been able to afford internet access, so she could not show how Lego fantards are making tribute videos and putting up on YouTube. Here’s an example: the Lego video circle circle dot dot. But it’s here.

* For wheels of a size you can hold in your fingers!

LOGITECH

Glenn Rogers, Logitech told another good “NPS changed our culture” story. He spoke passionately about how focus on customer is changing Logitech, to the extent that NPS is being used in product planning i.e. how many detractors/promoters will product X generate…

Learnings:

• You can’t have a special team of people reading Verbatim comments. You have to give them directly to the people who need info (this also came out later: don’t do analysis – let the front line people who deal with customers do it).
• Some products tweaked through their life as a result of initial NPS of 3 rose to 19, then 30.
• Promoters are worth 1.63x value of Passive. Detractors worth 0.06x that of passives. 400 verbatim responses give a complete enough picture for one product – diminishing returns after that. 152K responses on initial blast. 40K per qtr ongoing, survey sent 2 weeks after s/w install.

Glenn reminded us of Dells “Moments of Truth” which dated back to time I was there in later ‘90s. Three opportunities to delight or annoy customer – not a bad place to start thinking about customer…

1. Did it arrive in expected time (metric: Length of Time of delivery)
2. Did it work out of the box? (metric IFIR Initial Field Incidence Report)
3. If it went wrong, was it fixed quickly (On Time First Time fix)

VIRGIN MEDIA

Virgin Media’s Sean Risebrow related a great story of a fearless “big bang” NPS implementation, with complete aircover from Chief Exec. When you hear Sean speak with his enthusiasm for the brand and what they are doing, you just want to sign up for Virgin straight away. I can imagine working for Sean is a great experience… and I am guessing that Virgin is starting to make a difference in the Quad-Play Media Market. I wish them luck!Observations:

• Promoters give you one-liners, Detractors write you stories of what went wrong.
• 250K comments back: Seems massive, but actually only 10 comments per week per team leader.
• At the start, focus on your 10s to show good engagement. Build a “10 wall” of good customer experiences.
• Don’t interpret the customer issues centrally. Let them go to the teams and get them to understand and solve tactically.

He ended with a nice quote on his slide: “Net Promoter – It’s the way we do things around here”.

ALLIANZ

Andrew Clayton from insurers Allianz presented one of the evergreen NPS stories – they have lots of experience with the metric. Still, a few new interesting points:

• “Top down” vs “Bottom up” NPS. – embedded in management dashboards.
• It’s a key management KPI
• 91% of their customers take part (b2b)
• Growth is linked to NPS: Their best in class divisions measured by NPS are growing 10%

Key success factors included:

• Well defined scope
• Included many experts from across the business especially in touch points
• Cross functional teams with in-depth training
• Effective communications and identifying/implementing quick wins.

More about 2nd day later… In the meantime, to help you follow Richard Owen’s suggestion, and get back to YOUR roots, here’s Odyssey with “Going Back To My Roots” from 1981…

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